Why Payment Modernization is a Must for Financial Service Industry in 2024?

The financial services industry has been buzzing about the critical need for payment modernization, and for good reason. A recent Celent survey found that one-third of bank representatives from Europe and APAC ranked payment modernization as a top three priority for 2024. The time for procrastination is over – banks that have yet to modernize their payment systems risk falling behind competitors and jeopardizing their ability to operate efficiently.

The Payment Modernization Imperative

Legacy payment systems have long held banks back from innovating and offering personalized solutions beyond their major clients. These systems were often rigid, making future upgrades complex and costly. As a result, many banks opted to stick with the status quo.

However, banks can no longer afford to delay payment modernization:

1. Technology Debt: Many payment systems being used today are over a decade old, built on outdated architecture that struggles to integrate new capabilities.
2. Operational Inefficiency: Siloed legacy systems lead to duplicative efforts, manual processes, and lack of straight-through processing across payment types.
3. Restricted Innovation: Outdated platforms make it challenging to introduce new payment services and experiences.
4. Compliance Challenges: Keeping up with evolving regulations and standards like ISO 20022 is an challenging battle on older infrastructures.
5. Competitive Disadvantage: Fintech competitors are agile in deploying modern payment solutions, posing a threat to traditional banks.

The Path to Payment Modernization

Payment modernization is a complex, once-in-a-generation undertaking for most banks. A piecemeal approach of simply reducing costs or replacing components is insufficient. Banks need a holistic strategy driven by a clear vision for their payment needs today and over the next 5-10 years.

At the heart of this strategy should be implementing a modern payment hub solution that unifies previously siloed payment processing across multiple rails and types onto a single platform. Robust payment hubs enable:

• Increased straight-through processing and end-to-end automation
• Real-time transaction monitoring, notifications and reporting
• Rules-driven smart payment routing and intelligent payment orchestration
• Seamless integration with internal systems and third-party providers
• Scalable, secure, cloud-based infrastructure for resilience and future growth

The Right Partnership

Given payment modernization's complexity and risk, banks should thoughtfully select an experienced implementation partner, not just a technology vendor. The ideal partner brings expertise from numerous payment hub deployments across the industry to guide strategy, design and execution.

Leading payment partners offer advisory services to help banks assess their current state, define requirements, and chart a comprehensive modernization roadmap aligned to their long-term vision and business objectives.

Payment process modernization is an urgent need, but also a transformative opportunity. By upgrading infrastructure, banks can reduce technical debt, boost operational efficiency, ensure compliance, open new revenue streams, and deliver superior customer experiences. With a strategic partner and best-in-class solutions, banks can establish a future-proof payment backbone to thrive in an era of rapidly evolving demands.

The Role of Techzert in Payment Modernization 

In the journey of payment process modernization, having the right technology partner is more important than anything else. This is where Techzert steps in, offering a range of services tailored to the needs of the financial industry.

Techzert specializes in cutting-edge solutions such as IBM Financial Transaction Manager (FTM) for Real-Time Payments, FTM for Digital Payments, RedHat OpenShift on IBM Cloud, and Cloud Integration Services. These services play a crucial role in enabling banks and financial institutions to modernize their payment infrastructure systems effectively.

1. IBM FTM for Real-Time Payments: With the increasing demand for real-time transactions, Techzert's implementation of IBM FTM for Real-Time Payments ensures seamless and secure processing of instant payments, meeting the expectations of today's digitally savvy customers.
2. FTM for Digital Payments: Digital payments are reshaping the landscape of financial transactions. Techzert's expertise in FTM for Digital Payments empowers banks to offer a wide range of digital payment services, enhancing customer convenience and satisfaction.
3. RedHat OpenShift on IBM Cloud: Embracing cloud technologies is crucial for scalability and flexibility. Techzert's deployment of RedHat OpenShift on IBM Cloud provides a robust platform for hosting modern payment applications, ensuring reliability and agility in operations.
4. Cloud Integration Services: Integrating various payment systems and applications is a complex task. Techzert's Cloud Integration Services streamline this process, enabling seamless communication between different components of the payment ecosystem.

By leveraging Techzert's payment modernization services, financial institutions can accelerate their payment modernization initiatives, reduce time-to-market for new payment products, enhance operational efficiency, and ultimately deliver superior experiences to their customers.